- Clement finds out that the property he’s trying to buy has an equitable mortgage from Jared
- Totally unbeknownst to Jared, and outside his duties as a solicitor, Parr (Jared and Clements’ solicitor) fraudulently creates a document stating that the mortgage has been paid off
- Clements buys the property
- Whose interest prevails? The equitable mortgage or the later legal interest?
- Had they not searched the bankruptcy files initially, they would never have known about the equitable mortgage as it wasn’t a reasonable search
- However, in doing so Clements lost the ability to be “without notice” despite the actions of Parr
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